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Happy Friday!
It’s been a strange week as we not only clear out the skeletons from our closets, but also prepare for the last few months of the year.
But no one has had a worse week than ETH, which is down 10% this week (though things are starting to improve today). That’s it for a bullish start to the fourth quarter.
Apart from all this, there are some bullish trends on the horizon. For example, Permissionless is just a few bedrooms away, and there will be a lot of people speculating about where we’ll go next, with a healthy dose of what makes people optimistic… or bearish.
Now I’ll go pack my bags. See you next week!
— Kathryn Ross
The clock is ticking
By now, most loyal Empire readers are aware of Binance CEO Tigran Gambaryan and his ongoing imprisonment by the Nigerian government.
But as reported by ICYMI, Gambarian was detained in Nigeria earlier this year after meeting with government officials on behalf of Binance. To put it mildly, relations between the country and Gambaryan’s employer are not very good. And, unfortunately, Gambaryan became a pawn in the ongoing dispute between them.
Fast forward to now: Gambaryan, suffering from health problems, is still in Kuje Prison. And I would like to report that there is more to report. But, unfortunately, this is not the case at the moment.
Gambaryan will appear in court next Wednesday, October 9, at a hearing at which the judge will decide whether to release him on bail.
However, I wanted to mention him not only because of the current situation, but also because the more I studied Gambaryan, the more I realized how extensive his connections with cryptocurrencies are.
When I first started covering the situation back in February, I identified Tigran as a former tax official. But, dear reader, did you know that he became an expert (according to a 2015 affidavit, which we’ll get to) on digital currency while working for the IRS?
Wired’s Andy Greenberg, who wrote the book Footprints in the Dark: The Global Hunt for Crypto Crime Bosses starring Gambaryan, called the former IRS agent “something of a legendary figure in the world of crypto crime investigations.”
Gambarian served as a special agent involved in the capture of former DEA agent Mark Force and former Secret Service agent Sean Bridges, both of whom were involved in the Silk Road.
In a 2015 affidavit, he wrote that the two “abused their positions” as federal agents. Detailing his experience, he said he “specialized in cyber and digital currency crimes.”
Following his government career, Gambaryan joined Binance just over three years ago in 2021.
“Tigran has led several multi-billion dollar cyber investigations, including the Silk Road corruption investigations, the BTC-e bitcoin exchange, and the Mt. Gox,” Binance said in a press release announcing the hire.
Earlier this week, Tigran’s wife Yuki Gambaryan gave an interview to Illicit Edge’s new podcast “Designated” about his incarceration.
“Tigran is innocent, he didn’t do anything wrong,” she told host Yaya Dzhata Fanusi. She also pushed for more “robust action” from the US government.
“I am constantly afraid of losing Tigran,” Yuki continued.
— Kathryn Ross
YIKYK
Could BitGo’s stablecoin offering turn the entire stablecoin market on its head?
Empire’s Jason Janowitz seems to think so. In today’s episode of Empire, he mused that the launch of USDS could encourage more companies to launch their own stablecoins.
“We will see custodians launch stablecoins. We will see exchanges launching stablecoins. We’ll see fintechs like Robinhood launch stablecoins… Visa helps BBVA launch stablecoin. We will see banks launch stablecoins. Everyone, including their mother, is going to launch a stablecoin,” Janowitz said.
However, we should note that Robinhood’s Johann Kerbrath told us earlier this week that they are not currently I’m studying stablecoin.
Janowitz also believes that stablecoin issuers “will have their hands forced and will have to figure out how to return revenue to users.” And the way they’re going to do that is not by providing income directly to users, but by providing it to people, perhaps exchanges, who are sitting on the income.”
Perhaps this will be enough to topple Tether. Perhaps not.
And now you know.
It’s officially the fourth quarter (where has the time gone?) and this might be the perfect time to look back at the past quarter and see if we can analyze the coffee leaves here.
Admittedly, the unrest in the Middle East makes these results a little gloomier than we might have hoped. But barring unknown events or catalysts, overall expectations for the fourth quarter are positive.
I know we haven’t had a lot of charts this week, so I dug up a few to finish off the week, starting with this one, courtesy of CoinMarketCap’s report that summed up last quarter.
We shared earlier this week why it might not be Uptober, but perhaps November and December still have a chance to take a more positive tone.
A rising tide floats all boats, right? Well, some cryptocurrency sectors may not even need Bitcoin to start a green boom and make profits.
To no one’s surprise, memes were the center of attention last quarter. But, perhaps a little surprisingly, CMC data shows “a shift away from DeFi and infrastructure projects towards more speculative and consumer-facing sectors such as artificial intelligence, media and memes in the latest quarter.”
CMC analysts generally agree with others I’ve talked to: the fourth quarter could be more positive as it removes a lot of unknowns, such as the US presidential election.
“Historically, the fourth quarter has often been a strong period for Bitcoin, with BTC prices up 90.33% on average over the past 10 years. Moreover, this year we are entering the fourth quarter with a relatively low price level. Given these factors, there is a significant possibility that we could see a price surge over the remainder of the year, potentially even pushing Bitcoin to a new all-time high,” the analysts wrote.
But there will be even more unknowns likely lead to drawdowns. If only we had a crystal ball to guide our course.
— Kathryn Ross
